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INSURANCE REGULATORY ANDDEVELOPMENT AUTHORITY OF INDIA

IRDA/F&A/ORD/MISC/176/06/2017 28th July 2017

ORDER

In terms of Section 52 B (2) of the Insurance Act, 1938to MIs ICICI Prudential Life Insurance Co. Ltd.to take over the life insurance

business portfolio of MIs Sahara India Life Insurance Co. Ltd.

1. Reference is drawn to the IRDAI Order IRDAII F&A lORD I FA 1134/06/2017dated 12'h June 2017 appointing an Administrator for managing the affairs ofMIs. Sahara India Life Insurance Co. Ltd., Registered and Corporate Office: #1,Sahara India Bhawan, Kapoorthala Complex, Lucknow 226024; Registration No. 127(herein after referred to as SIUC) under Section 52 A (1) of the Insurance Act, 1938

2. Based on the report of the Administrator submitted to the Authority vide letterdated 22nd June 2017 in terms of Section 528 of the Insurance Act, 1938, SIUC wasdirected not to procurelcollect proposal deposits lunderwrite new business, with effectfrom close of business on 23rd June 2017 videlRDAI Order IRDA IF&A lORD IFA 1148106/2017 dated 23rd June 2017

3. The report of the Administrator indicated that there is total failure of the

governance system of SIUC and the interests of the policyholders are at stake. The

report inter alia states as under:

I. The promoters of the company are no more "fit & proper";II. A sum of ( 78 crore has already been siphoned off in name of the security

deposits;

III.. The shareholders and Board of Directors are not keen in recovery plan;IV. The company is mainly surviving on the release of reserves. However, the

situation may not continue for long as the new premium of the company hascome down significantly;

4. The Chairman and independent director of SIUC and the Chairman of Sahara

Group had sought a meeting and presented a representation vide their letter dated

11th July 2017 and 215t July 2017. Accordingly, the meeting was conducted on 24th

July 2017. In this regard, the Authority observed that SIUC has not brought any new~--mw:r~, ~m1, ti1~ft<ti1ljl,~-500 004. 'IffiCf

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Parisharam Shavan, 3rd Floor, Sasheer Sagh, Hyderabad-500 004. India.Ph.: 91-040-2338 1100, Fax: 91-040-6682 3334E-mail: irda@irda.gov.in Web.: www.irda.gov.in

facts or information warranting revisiting the Orders of the Authority issued on

Appointment of Administrator for SlUG.

5. Based on the above facts reported by the Administrator in his report dated 22nd

June 2017, the Authorityhas come to the conclusion that continuation of SILIG totransact life insurance business is not in the interests of the holders of life insurancepolicies in general and accordingly, consider it to be a fit case to transfer the lifeinsurance portfolio of SlUG to some other insurer as envisaged under section 52B (1)of the Insurance Act, 1938.

6. In order to transfer the business as stated above, the Authority decided totransfer the aforesaid business of SlUG to a life insurer who fulfil the following criteria:

a) The Insurer who is in profits;b) The Insurer without accumulated losses;c) The Insurer who is compliant with the prescribed limits on Expenses of

Management; andd) The Insurer who is compliant with the Solvency Margin requirements

7 Six life insurers met the above criteria. The Authority sought to know theirinterest by so" June 2017. Out of the six life insurers who qualified as per the abovecriteria, MIs IGIGI Prudential Insurance Go. Ltd (herein after referred to IPRU)expressed interest in taking over the said portfolio within the given timelines subject toconducting necessary assessment and due diligence of the policyholders' assets andliabilities and other related and ancillary matters. The Authority had facilitated therequired process.

8. IPRU has submitted their proposal for taking over insurance policies of SILIG(i.e., the liabilities) along with the corresponding investments (i.e., assets)vide theirletter dated zs" July 2017.

9. In order to facilitate the takeover process, the Authority had appointed anIndependent Actuary Shri G. N. Agarwal, to carry out the valuation of the insuranceliabilities of SlUG that is to be transferred to IPRU as on the appointed date.

10. Now, in terms of Section 52 B (2) of the Insurance Act, 1938, in the interests ofthe holders of life insurance policies, the Authority comes to the conclusion that it willserve the interests of the policyholders if the life insurance portfolio of SlUG istransferred to IPRU. Accordingly, the Authority hereby, directs MIs IGIGI PrudentialLife Insurance Go. Ltd., with Registered Office at: IGIGI Prulife Towers, 1089,

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Appasaheb Marathe Marg Prabhadevi, Mumbai 400 025 (herein after referred to asIPRU) to take over the life insurance portfolio of SILIC on the appointed date

11. In terms of section 52 B (3) of the Insurance Act, 1938, this Order is binding onall persons concerned, and shall have effect notwithstanding anything in thememorandum or articles of association of SILIC.

12. On and from the appointed date:

I. IPRU shall assume the insurance liabilities of SILIC as per the valuationof the Independent Actuary as on the appointed date;

ii. SILIC shall transfer the following assets / investments to IPRU onirreversible basis:

i. The investment pertaining to the policyholders;ii. Loans against policies;III. Current assets representing the current liabilities;iv. Cash or Cash equivalent to the extent of non-par fund;v. Any cash / cheque lying with the branches of the SILIC on

account of premium on life insurance policies issued by SILlC;

Provided that the asset corresponding to the policyholder liabilities asper the statutory valuation report submitted by the Appointed Actuary ofSILIC in respect of valuation conducted as on 31st March 2017 shall betransferred at the earliest.

Provided further that the asset corresponding to the change in thepolicyholder liabilities as on the appointed date shall be transferredbased on the report of valuation of insurance liabilities of SILIC by theIndependent Actuary appointed by the Authority (refer para 8 above).

13. SILIC and its promoters/shareholders shall:

a. Transfer all records pertaining to the policyholders (both in physical andelectronic format) to IPRU not later than 21 days after the appointeddate;

b. Finalize and submit the annual accounts for the year 2016-17 to theAuthority within 21 days of the appointed date;

c. Finalize and submit the result for the period ended 31st July 2017 to theAuthority within 30 days of the appointed date;

d. Reimburse the cost of salary, allowance and other expenses of theAdministrator and other expenses incurred by the Authority in this matterat the earliest;

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e. Be liable to honour any commitments made to its policyholders, agents,and intermediaries, if any, which are beyond the scope of the productFile and Use requirements within six months of the appointed date.

f. Be responsible for all liabilities other than the policyholders' liabilitiestransferred to IPRU. The statutory liability such as income tax, servicetax etc., entirely rest with SILIC

g. Be liable for any non-compliance/pending compliance with any judicialorder or award passed against it prior to the appointed date

14. Shareholders' investment will be under the control and supervision ofAdministrator till the para 13(a) to (d) are complied with by SILIC to the satisfaction ofthe Authority. A sum of <' 25 crore shall be transferred to a separate account under thecustody of the IRDAI for a period of one year. The primary responsibility of honouringclaims on policies beyond whatever has been informed/shared with IPRU and/or anyother liabilities of SILIC pertaining to the transactions before the appointed date shallbe that of the promoters/shareholders of SILIC. However, to meet any othercontingencies theamount under the custody of the IRDAI will be utilized. The saidamount shall be refunded to the SILIC after the said period of one year.

15. SILIC shall not carryon life insurance business after the appointed date.Accordingly, the Certificate of Registration no. 127 dated 6th February 2004granted toSILIC shall be surrendered to the Authority within 15 days of the appointed date failingwhich the Certificate of Registration shall stand cancelled.SILIC shall also apply toRoC for 'change of name' and remove the words 'life insurance' from its name within30 days of this Order and inform the Authority.

16. SILIC shall not use the name M/s Sahara India Life Insurance Co. Ltd. in thestationery or elsewhere after the appointed date.

17. IPRU shall ensure that to the extent of the life insurance portfolio taken overfrom SILIC (to be referred to the portfolio herein after) systems are integrated into thesystems of IPRU within a period of one year from the appointed date.

18. IPRU shall be liable for the liabilities on the books of SILIC after the appointeddate. All the regulatory/legislative compliances as regards the said portfolio shall beensured after the appointed date.

19. A moratorium period of fifteen days is allowed to policyholders to pay renewalpremium and IPRU is given twenty onedays for settlement of claims after which theservicing of policyholders of SILIC shall be carried on by IPRU unhindered. However,efforts shall be made to ensure that systems/processes are integrated at the earliest,in order to ensure smooth acquisition.

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20. IPRU shall bring about compliance with the IROAI (Investment) Regulations,2016 as regards the life insurance portfolio of SIUC on a standalone basis or onoverall basis by 31st March 2018.

21. IPRU shall take steps and set up systems to bring about compliance withKYC/AML guidelines as regards gaps, if any, that may have been observed in the saidportfolio, going forward.

22. IPRU shall ensure the confidentiality of the policyholder data pertaining to theportfolio.

23. SIUC and IPRU shall arrange to host a copy of this Order on their websiteprominently and also arrange to paste a copy of the operative portion of this Order in aconspicuous place at each of its branches and offices.

24. IPRU shall give Public Notice confirming the takeover and also informing thepolicyholders of SIUC the manner in which policies after the appointed date will beserviced by them. Notice shall also be sent by IPRU to the policyholders of SIUC inthe matter.

25. IPRU shall make available FAQs as regards servicing of policyholders of SIUCand also publish the same in their website. A dedicated call center/e-mail 10 becreated to handle the concerns/issues of policyholders of SIUC.

26. IPRU shall publish in two national level largely circulated newspapers (one inEnglish and the other in Hindi) about takeover of life insurance portfolio of M/s SaharaIndia Life Insurance Co. Ltd.

27. The appointed date for the effecting the aforesaid transaction would be 31st July2017.

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News Release

Mumbai, July 28, 2017: ICICI Prudential Life today received an order from IRDAI directing it

to take over the assets and policyholder liabilities of Sahara Life Insurance. This is not a

merger between the two companies but purely a transfer of customers to ICICI Prudential

Life.

We are pleased to welcome the new customers to the ICICI Prudential Life family. We would

like to assure them of high levels of service and commitment.

The Company will in due course intimate the new customers on various touch points and

manner of servicing.

About ICICI Prudential life insurance

ICICI Prudential Life Insurance Company Ltd. (ICICI Prudential Life) is a joint venture between ICICI Bank Ltd. and

Prudential Corporation Holdings Limited which is a part of an international financial services group

headquartered in United Kingdom.

ICICI Prudential Life was amongst the first private sector insurance companies to begin operations in December

2000. The Company has maintained its leadership position, on a Retail Weighted Received Premium basis

(RWRP) among private sector life insurance companies. The Company offers products across the categories of

Protection and Savings that fulfil the different life stage needs of customers.

ICICI Prudential Life is the first private life insurance company to cross the `1 trillion mark for assets under

management (AUM) and as on June 30, 2017 had an AUM of `1,265.91 billion and in-force sum assured of over

`3 trillion.

ICICI Prudential Life is listed on National Stock Exchange (NSE) and The Bombay Stock Exchange (BSE).

Disclaimer

Except for the historical information contained herein, statements in this release which contain words or phrases

such as 'will', ‘expected to’, etc., and similar expressions or variations of such expressions may constitute

'forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and

other factors that could cause actual results, opportunities and growth potential to differ materially from those

suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the

actual growth in demand for insurance and other financial products and services in the countries that we operate

or where a material number of our customers reside, our ability to successfully implement our strategy,

including our use of the Internet and other technology our exploration of merger and acquisition opportunities,

our ability to integrate mergers or acquisitions into our operations and manage the risks associated with such

acquisitions to achieve our strategic and financial objectives, our growth and expansion in domestic and

overseas markets, technological changes, our ability to market new products, the outcome of any legal, tax or

regulatory proceedings in India and in other jurisdictions we are or become a party to, the future impact of new

accounting standards, our ability to implement our dividend policy, the impact of changes in insurance

regulations and other regulatory changes in India and other jurisdictions on us. ICICI Prudential Life Insurance

undertakes no obligation to update forward looking statements to reflect events or circumstances after the date

thereof. This release does not constitute an offer of securities